Toyota's and Nissan's sales leaped ahead last month - but they paid for the privilege.
Toyota Motor Sales U.S.A. Inc. and its captive finance arm spent 150.1 percent more on incentives than they did in April 2004. For the Tundra pickup, for instance, Toyota ratcheted up spending to $3,387 per unit, up from $801 in April 2004 and $3,180 in March 2005, according to Edmunds.com, a research firm that tracks incentives.
The result was the best-ever month in Toyota's existence in America.
Nissan North America Inc., meanwhile, spent 132.9 percent more on incentives in April, with nearly every Nissan-branded vehicle carrying at least $2,000 in incentives per unit. Nissan and Infiniti sales increased 31.9 percent.
But the leading Japanese still spent far less than their domestic rivals. The Big 3 accounted for $2.81 billion of the $3.65 billion the industry spent on incentives in April. Japanese manufacturers spent $528 million. European manufacturers spent $178 million, and Korean manufacturers spent $128 million.
The Chrysler group provided the lone glimmer of good news last week from the Big 3. Its sales rose 9.3 percent in April, but the gain was costly.
Even though Chrysler has vowed to reduce incentives, the group spent more per unit on incentives - $3,535 - than any automaker, Edmunds.com says.
While Ford Motor Co.'s domestic brands far outsold Chrysler group in April, Chrysler's incentives budget of $730 million nearly eclipsed Ford's budget of $776 million.
Chrysler products made up six of the top 12 nameplates in terms of total incentive dollars spent in April. Those vehicles were the Dodge Ram 1500 (third most incentives spent), Jeep Grand Cherokee (sixth), Chrysler Town & Country (seventh), Dodge Grand Caravan (ninth), Chrysler Pacifica (11th) and Jeep Liberty (12th).
By contrast, even with their opened wallets, Toyota spent $1,015 per vehicle, Nissan spent $1,822 per vehicle, and Honda spent just $470 per vehicle, according to Edmunds.com.
Edmunds.com reaches its sales-weighted calculations based on customer cash-back deals, loan and lease financing subvention and manufacturer-to-dealer incentives. Dealer reward trips, salesperson spiffs and stair-step volume bonuses are not included.
Ford Motor and General Motors spent heavily on incentives but had little to show for it. Total Big 3 market share dropped 3.4 percentage points in April compared with April 2004. The figures exclude the Big 3's overseas brands.
|Who went all-in|
|Big 3 continue to ladle on incentives|
|Avg. per unit||Total incentives|
|Chrysler group***||$3,535||$730 million|
|Toyota, Lexus, Scion||$1,015||$214 million|
|Nissan, Infiniti||$1,822||$167 million|
|Hyundai, Kia||$1,885||$128 million|
|Honda, Acura||$470||$64 million|
|* Excludes Saab|
|** Excludes PAG brands|
|*** Excludes Mercedes-Benz, Maybach|
SUV sales drop
Sales of the Chevrolet Suburban, Avalanche and Tahoe, Hummer H2, Cadillac Escalade and GMC Yukon and Ford Expedition and Excursion SUVs dropped at least 20 percent in April. That drop comes even though the automakers spent more than $4,000 per unit on nearly every one of the gasoline-thirsty nameplates.
While GM and Ford faltered, Japanese and Korean automakers increased their incentives, with strong results.
In addition to Toyota's record month, Honda, Acura, Nissan, Infiniti, Subaru, Hyundai and Kia all scored their best April in the United States.
What's more, these gains came despite heavy Big 3 incentive spending.
Cadillac saw a strong 23.3 percent sales gain in April, yet more than 95 percent of its total volume had at least $3,000 in per-unit incentives on the hood. Lincoln Division saw an 8.6 percent sales gain, but nearly 80 percent of its sales volume had more than $5,000 per unit in incentives, according to Edmunds.com data.
Nearly 80 percent of GMC's volume had $3,500 in incentives, yet sales still slid 11.1 percent. No Buick vehicle had less than $2,500 in incentives, yet the brand had flat sales. Pontiac had 60 percent of its sales volume laden with more than $3,000 each in incentives and also had flat sales.
By comparison, no Honda, Acura or Lexus vehicle had more than $900 per unit in incentives.
But some Asian brands still offered significant incentives to stay competitive. Sixty percent of Toyota Division volume carried between $1,000 and $2,000 per unit in incentives. More than 70 percent of Hyundai vehicles, and nearly 80 percent of Kia vehicles had more than $1,500 per unit.
You may e-mail Mark Rechtin at [email protected]